Mexico’s TV Azteca has sold its U.S. network Azteca América to HC2 Network Inc. in a transaction that includes a seven-year programming licensing and broadcast services agreement. The deal gives HC2 access to TV Azteca’s current programming and library in Mexico, including entertainment shows, network and local news, as well as telenovelas and other scripted series.

“For Azteca América, it’s a great day. This is a very important transaction for us,” says Abud. “When I took over the network, I focused on turning it around, changing the culture and execution. We’ve been hyper focused on performance….But we looked in the mirror and realized we really need to create some scale to move to the next level. We knew we weren’t able to do it alone.”

As they looked for a partner, Abud says Azteca began conversations with HC2 during this past summer and moved quickly to seal the deal. The financial terms were not disclosed.

“The real purpose of these two contracts is to emulate the relationship Azteca América had with TV Azteca Mexico. In a way, we’ll continue to work as an affiliate, as a subsidiary, although we’re no longer a subsidiary,” explains Abud.

Through the licensing agreement, Azteca’s daily shows and other content will continue to feed Azteca América’s programming lineup, while the broadcasting services agreement allows HC2 to use Azteca México’s resources and production facilities to potentially produce original content.

"I’m never going to apologize for running a lean operation. The industry is changing and we have to keep up with the times," states Abud. "We have to be on top of the economics of the business, if you want to remain in the business."

The HC2 acquisition could be a game changer for a network that primarily caters to a U.S. Mexican audience, but trails far behind Univision and Telemundo.

In addition to announcing the Azteca América purchase, HC2 Network today also signed a definitive acquisition agreement with Northstar Media LLC to buy 19 of its television stations that currently air Azteca América programming.

“If you look at HC2… they now have 113 operating stations. That’s a phenomenal footprint. That represents a great opportunity to create scale, additional distribution outlets and additional elements to go out to the advertisers.”

The sale of Azteca América falls in line with its parent company’s “strategic purpose,” which Benjamín Salinas, CEO of TV Azteca stated is “solid core operations in Mexico and on maximizing our profitability abroad….This transaction is a natural progression to our new value-driven vision.”

Earlier this year, Azteca América, which owned 50% of spectrum in its flagship Los Angeles station KAZA-TV, picked up more than $91.1 million in the FCC reverse incentive auction.